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After a number of years, it can be worthwhile to change factoring company. Do you run a business that sells on credit? Are you looking for a new factoring company? Call 0800 597 4757 and speak to one of the factoring advice team to see whether we can improve on your factoring facility.

There could be a number of reasons why you might consider switching to another Invoice Finance provider. You might be unhappy with the level of service received from your existing provider, or you may feel that you could get the service more cost-effective elsewhere.

In our experience, there are two main reasons why you might be hesitant in switching to another provider:

  • You feel that it will be a lengthy, time-consuming process; or
  • You are contracted to another provider so you will be charged if you leave within the contract period

Information on changing factors

The main reason for changing your factoring company may be to get a better factoring deal and save money. By talking to the UK factoring helpline about changing your factoring facility you could reduce your monthly payments or take advantage of a niche factoring company that specialises in your particular business sector.

Inform your factoring company that you’re considering changing factoring provider.

The factoring company will often come back with the offer of an improved factoring deal. While you may not stay with them, the offer can be used as a starting point to compare to other factoring companies

Weigh up the costs of factoring agreements.

If you are required to pay a penalty charge to change factoring providers, then you need to consider this when looking at other deals – a factoring change may not be worth it overall. Switching factoring companies can be a difficult process but if you feel that the benefits of a new factoring company would far outweigh the costs of changing factors, then the process should be considered. Please call 0800 597 4757 and speak to one of the factoring team to make sure the whole process is done properly.

It can be a major hassle to change factoring company

The main reason businesses opt to stay with the same factoring provider is the hassle factor. However easy changing factoring provider becomes, it will never be easier than doing nothing. But those businesses who do not investigate how much they could save by changing factoring provider may be losing out on thousands of pounds per year.

Why do businesses change factoring company?

In the UK few business secure a factoring facilty with the foresight of changing market conditions and how the factoring deal will suit them further down the line. Some businesses find that the old factoring company is no longer looking after the business needs. Also some businesses find a new factor that charges much lower fees than the current factor.

Is it difficult to change factoring company?

It’s a common perception that to change your factoring company is complicated. However this perception is often misplaced because changing factoring company is actually easier now than ever before. When you change your factoring provider, we make the process as easy as possible.

After our factoring team has got you a suitable factoring quote and chosen the factoring company that’s right for you, you can start the factoring application process. When you change your factoring company, we arrange an audit of your business and will also take care of the paperwork required

How to change factoring company?

You will need to be aware that when you change your factoring company, you may be required to pay various charges. This process is called ‘Change Factoring Liftout’.

The change factoring liftout clause outlines the procedure to change factoring company. A liftout agreement it a three party agreement signed by the old factoring company, new factoring company and the business looking to change factoring company. In the liftout agreement the business must approve the ‘liftout figure’ provided by the old factoring company.

What are the costs to change factor and follow the liftout process.

If you are able to submit brand new invoices to the new factoring company which they can use to payoff the outstanding invoices at your old factor then there would be no additional cost to you to make the change.

If you want to use the existing invoices that have already been factored then you can negotiate a one off fee.

Depending on the size of the transaction, some factoring companies offer reduced fees on old invoices which are part of a buyout. You also want to make sure you give the proper notice of intent to terminate to your old factor (if required) to avoid any early termination fees to leave their contract early.

How long does it take to change factors following a liftout agreement?

When you are changing factoring companies it’s best to plan on the first funding taking a two to three more days than the normal factoring application setup process. The added days will be needed at the time of invoice verification and just before funding as liftout figures are calculated and sent to you for your approval.

Please call 0800 597 4757 if you are you unhappy with your current factor? Our dedicated factoring team will be able to let you know what you need to do if you want to change factoring companies.